UNION OF INDIA Vs. KOHINOOR TARPAULIN INDUSTRIES

JUDGEMENT

(1.) THE present objections are filed by the objector/ contractor under sections 16, 30 and 33 of the Arbitration Act, 1940 against an ex-parte award dated 11. 6. 1992 made and published by Sh. Ram Bahadur, Sole Arbitrator.

(2.) IN a nutshell, the facts of the case are that the petitioner/dgsandd entered into a contract dated 31. 8. 1987 with the objector/contractor for supply of tent private MK-3. The aforesaid tender is stated to have been accepted by the objector/contractor vide letter dated 9. 9. 1987. It is the case of the petitioner that as per clause 9 of the contract, the objector/contractor was required to deposit security to the tune of Rs. 27,290/- by 30. 9. 1987 in favour of DGSandd for due performance of the contract. The aforesaid clause also stipulated that in case of failure on the part of the objector/contractor to deposit the security by the date specified, it would be a breach of the contract which would entitle the petitioner to cancel the contract and recover damages for the loss sustained as a result of repurchase. As per the petitioner, the objector/contractor failed to furnish the security by the date fixed, i. e 30. 9. 1987. As a result, the petitioner/dgsandd cancelled the contract for the unsupplied quantity of stores at the risk and cost of the objector/contractor. Though the objector/contractor participated in the risk purchase tender, but his offer was not considered on account of non-furnishing of 10% security and instead, the tender was awarded to two other parties. The petitioner claimed that it suffered loss amounting to Rs. 5,13,149. 60 paise which was demanded from the objector/contractor on 15. 9. 1989.

(3.) AS the objector/contractor failed to pay the aforesaid amount to the petitioner, disputes and differences arose between the parties. Vide letter dated 23. 9. 1989, the objector/contractor invoked the arbitration clause governing the parties and requested the DGSandd to appoint an arbitrator. Vide order dated 27. 12. 1989, Mr. R. K. Gupta was appointed as the Sole arbitrator, but he tendered his resignation on 26. 7. 1990. Subsequent thereto, vide order dated 31. 10. 1990, Sh. C. Achuthan, was appointed as the sole Arbitrator. Vide order dated 30. 1. 1991, both the parties gave a written consent for enlargement of time for the purposes of making and publishing the award within a period of four months. The aforesaid period was further extended upto 3. 11. 1991. In the meantime, as per the order dated 14. 10. 1991, the objector/contractor filed an affidavit by way of evidence. Vide order dated 30. 10. 1991, the learned Arbitrator adjourned the case sine die in the absence of consent for enlargement of time. Thereafter, on 17. 1. 1992, mr. Achuthan tendered his resignation.